THE PESO declined against the dollar on Monday due to expectations of faster February inflation.
The local currency closed at P54.88 versus the greenback on Monday, dropping by six centavos from Friday’s finish of P54.82, data from the Bankers Association of the Philippines’ website showed.
The peso opened Monday’s trading session at P54.80 per dollar. Its intraday best was at P54.76, while its worst showing was at P55.915 against the greenback.
Dollars traded dropped to $810.1 million on Monday from the $1.287 billion recorded on Friday.
The peso weakened ahead of the release of the February consumer price index (CPI) report on Tuesday, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message.
Mr. Ricafort said the market expects inflation to have reached a fresh peak last month.
“The peso weakened due to some caution ahead of the Philippine inflation report tomorrow,” a trader said in an e-mail.
A BusinessWorld poll of 17 analysts yielded a median estimate of 8.9% for February headline inflation, within the 8.5% to 9.3% forecast of the Bangko Sentral ng Pilipinas (BSP) for the month.
If realized, this will be faster than the 14-year high of 8.7% seen in January and the 3% a year earlier. It will also exceed the BSP’s 2-4% target for the year.
The trader said the peso-dollar trading on Tuesday will be driven by the release of February inflation data.
The trader expects the peso to move between P54.80 and P55 per dollar on Tuesday, while Mr. Ricafort sees the peso trading at P54.75 to P54.95. — AMCS